Steve Poizner was not kidding when he released that internal poll showing him competitive with Meg Whitman. Despite spending $59 million on the race, Whitman has seen her 50-point lead all but dissipate. SurveyUSA, which had this race at 22 points just a couple weeks ago, now sees Whitman ahead by only two, 39-37 with lots of undecideds.

What can account for this epic crash? First off, the Poizner ad tying eMeg to Goldman Sachs is, outside of the Joe Sestak’s closing ad against Arlen Specter, the best of the cycle.

Beyond that, Whitman just punched herself out. The massive pre-primary spending became the story more than her worth as a candidate, and when Poizner and his millions got competitive on air it became a race. Whitman’s been pretty terrible in the two debates thus far as well. Also, the CA Republican primary electorate is, shall we say, crazy, and Poizner has one of the staunchest conservatives, Tom McClintock, on his side. His personal testimonial ad for Poizner is pretty successful, as he’s the most high-profile conservative in the state.

This would seem to validate the conclusion I made last week that Whitman’s support was extremely soft, and that she was vulnerable to attack. Poizner has exposed her fundamental weakness – her ties to Goldman Sachs and other big banks that are responsible for our economic crisis – and shown that Whitman isn’t invincible.

Of course, she also has time to react and right the ship. Having a big money advantage helps close the deal in the final weeks, and we can expect her to ramp up her ad blitz and outreach to GOP primary voters. Poizner may have her beat here too, however – Whitman cannot demagogue against immigrants too strongly or else she has no chance whatsoever of winning the fall election against Jerry Brown, since she’ll alienate moderates and Latinos. Poizner, fighting for survival, has no other choice.

It’s kind of hilarious watching these two out-crazy each other on my teevee screen. Somewhere Jerry Brown is smiling.